General Electric has created a Home Energy Management business in a bid to apply digital technologies to energy efficiency in consumers' homes and the electric grid, the company said today.

The business unit, part of GE Appliances & Lighting, combines "smart" appliances and an Internet-based home energy management system called Nucleus, which is set for release next year.

By making a single business unit for home energy, GE is trying to focus its efforts on consumer interest in smart-grid technologies geared at using energy more efficiently, the company said.

"It makes economic and environmental sense for the world to better utilize the power we already generate rather than create more capacity to meet our escalating peak-power needs," GE Home Energy Management general manager Dave McCalpin said in a statement. "If we can better manage when and how we use power, we can control the demand without compromising people's lifestyles."

GE's vision for home energy management revolves around networked devices that can give consumers more information on energy consumption and communicate with the utility through a smart meter.

The Nucleus home energy management system is a small gadget about the size of mobile phone charger and acts as a network hub, connecting to a thermostat, smart meter, and other networked appliances. Using a PC or smart phone, people can see how energy is being used and control appliances to, for example, program a thermostat or turn on the heat during a drive home.

GE is developing a line of appliances that can be connected to a home network as well. Once connected, they can be remotely controlled from a smart phone or PC. But the energy savings from smart appliances comes from communicating with a utility via a smart meter.

Utilities, which have regulatory incentives to use less energy, are eager to find ways to lower energy use during peak times, typically in the late afternoon and early evening.

Through voluntary demand-response programs, a consumer can agree to have a clothes dryer, for example, take longer to complete its job in order to lower energy use. GE's hybrid hot water heater already has a Zigbee networking chip in it, and the company plans to introduce more appliances that can be connected to the grid.

GE is enthusiastic about home energy management systems not only because it's a new business area that can help sell appliances, but because GE also makes power equipment to utilities, including smart meters and transformers.

The company has said that with on-site power generation and an energy efficient home, a household could be a net zero energy consumer. GE plans to introduce thin-film solar panels next year as well as an electric-vehicle charging station.